Fitch Ratings stated this in its report on Wednesday titled ‘Nigeria’s deficit monetisation may raise macro-stability risks’.
Part of the report read, “Sustained use of direct monetary financing could raise risks to macroeconomic stability – given the current weak institutional safeguards – but we expect the FGN to reduce its use of the facility in 2021. “A number of emerging markets resorted to central bank deficit financing in 2020 against a background of urgent spending needs and temporary market dislocations associated with the coronavirus pandemic.The report added, “We estimate that the balance of the government’s WMF with the CBN was around N9.8tn at end-2019, up from N5.4tn at end-2018.
Fitch Rating stated that repeated central bank financing of government budgets could raise risks to macro-stability in the context of weak institutional safeguards that preserve the credibility of policymaking and the ability of the central bank to control inflation.
They know oo.. But they will still keep borrowing and accumulating debts
Government that will still go and consult native doctor for money ritual.
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